Paulsboro's trainer Paul Morina cheers George Worthy as he takes on Wade Unger of Bergen Catholic in a £ 152 bout during a wrestling match at The Palestra in Philadelphia.
Joe Warner | USA today
The shareholders of the $ 100 million New Jersey deli company Hometown International sacked CEO Paul Morina, a school principal and renowned wrestling coach, late Friday after weeks of questions about the company and its role there.
Hometown International's majority shareholders also voted to remove the company's only other executive, vice president and secretary, Christine Lindenmuth, who works with Morina as an administrator at nearby Paulsboro High School. The deli is located directly across the Delaware River from Philadelphia and is Hometown's only operating facility.
Their ouster came a week after a previously unreported resignation of the president of a Shell company, E-Waste, which has multiple ties to Hometown International
According to the Securities and Exchange Commission's filings, shareholders who voted to remove Morina and Lindenmuth almost certainly included all or some members of two different groups of investment companies, one in Hong Kong and the other in Macau, a special administrative region in Hong Kong.
Morina, 62, held a number of other titles with Hometown International before being removed. According to financial reports, he owns 1.5 million common shares of the deli owner, which makes him worth more than $ 18 million, at least on paper.
Morina has been replaced as chief executive officer by Peter Coker Jr., chairman of Hometown International.
Hong Kong-based Coker Jr. is associated there with investment companies that have a major stake in the deli owner.
Coker Jr.'s father, North Carolina businessman Peter Coker Sr., is himself a major investor in the company.
Related Shell company E-Waste has also replaced its president John Rollo, 66, after CNBC raised similar questions about him, this company and its similarly absurd sky-high market cap despite the total lack of ongoing business.
Rollo, a Grammy Award-winning sound engineer, worked as a patient truck in a New Jersey hospital until recently.
Rollo, also based in New Jersey, has been replaced as President of E-Waste by Elliot Mermel, 31, a California resident who earns $ 8,000 a month in that role.
Mermel's colorful business background includes starting a company that grew crickets as human food and partnering in a cannabis business with Paul Pierce, the former Boston Celtics superstar basketball player.
Pierce, who won an NBA title with the Celtics, was fired from ESPN last month as an analyst for a racy Instagram Live poss that showed him in a room with exotic dancers.
On Saturday, the Boston Globe reported that Pierce will be inducted into the Basketball Hall of Fame as part of his 2021 class.
Mermel also started a biotech and artificial intelligence company and was a business development consultant for a fertilizer company, according to a financial file.
Mermel, a Colby University graduate, has another company, Benzions LLC, which has raised $ 4,000 every month since December under a consultancy agreement with E-Waste.
This agreement was terminated as part of its takeover of e-waste management, according to a notice filed with the Securities and Exchange Commission on Thursday.
Boston Celtics striker Paul Pierce waves to the crowd after finishing # 2 in the Celtics' all-time rankings in the second half of an NBA basketball game against the Charlotte Bobcats in Boston on Tuesday, February 7, 2012, and Larry Bird has surpassed (AP Photo / Elise Amendola)
SEC filings indicate that Benzions signed another consultancy agreement in March with a second Shell company, Med Spa Vacations, affiliated with Peter Coker Sr., who also pays Mermel's company $ 4,000 per month.
CNBC asked Morina, Lindenmuth, Rollo, Mermel, Hometown International's attorney, and a Hong Kong investor spokesman for comments.
The current President of Med Spa Vacations is the former President of E-Waste, Rollo, who took on the job in February.
The changes in the management of Hometown International and E-Waste were announced in 8-K filings with the SEC.
The deli owner's filing gave no reason why shareholders who control 6 million common shares – which equates to roughly 77% of the company's voting rights – voted out Morina and 46-year-old Lindenmuth. At least 5.5 million common shares of Hometown International are controlled by investors in Hong Kong and Macau.
According to the SEC filing, both Morina and Lindenmuth remain the clients in the delicatessen business.
Morina is also involved in a company that leases the deli area to Hometown International.
According to the filing from E-Waste, Rollo resigned as president on May 7, the day after CNBC reported the opacity of the investor group in Macau.
Your deli in your hometown in Paulsboro, N.J.
The moves, like other recent ones from each of the money-losing companies, appear to be an attempt to resolve controversial issues that undermine their common goal of merging with other companies in a transaction that would exploit their publicly traded status in the United States could markets.
Hometown International first attracted a lot of attention last month when hedge fund manager David Einhorn wrote to customers about the company's market cap, which had exceeded $ 100 million despite only owning a single small Italian deli.
This restaurant had combined sales of less than $ 37,000 for the past two years and has been closed for nearly half of 2020 due to the coronavirus pandemic.
Einhorn noticed Morina's incongruity as CEO of Hometown International while pursuing his day-to-day jobs as a school principal and wrestling coach.
Hometown Deli in Paulsboro, N.J.
Morina's team at Paulsboro High School is a consistent contender for state titles and one of the most successful coaches in New Jersey wrestling history.
But he doesn't have an obvious history of running a public company or a food service business before the Hometown Deli opened in his own hometown.
Morina, whose brother is a New Jersey county sheriff, wrestled with a man named James Patten at Paulsboro High School in the 1970s, who works for Coker Sr.'s Tryon Capital firm.
Patten has been banned from working as a stockbroker or working with broker-dealers by FINRA, the broker-dealer regulator, according to the regulator's database.
Prior to this sanction, Patten was the subject of repeated FINRA disciplinary actions, including failure to comply with an arbitration award of more than $ 753,000 for violating securities laws, unauthorized trading, and churning a client's account.
Since Einhorn's letter, CNBC has released more details about Hometown International and E-Waste, whose stocks, which traded in the low-tier pink over-the-counter market last year, have soared to staggering levels due to the relationships formed between them.
These questions included why some investors would pay so much to buy shares in thinly traded companies since there was no significant income in the deli owner's case or no income at all in the case of e-waste.
Even if both companies achieve their goal of reverse merging or similar transactions with private companies looking to trade on the stock exchange, current investors will not receive payments that in any way reflect the trading price of the shares.
Only 205 shares of Hometown International were trading on Friday, closing at $ 12.40 per share. Given the company's nearly 8 million outstanding common shares, it has a market capitalization of $ 96.68 million.
E-waste closed at $ 9 per share on Friday after no shares traded. With 12.5 million shares outstanding, E-Waste has a market capitalization of $ 112.5 million.
Over the past few weeks, both the deli owner and E-Waste have declined their share prices, stating in extraordinary SEC filings that there is no financial justification for their market capitalization.
The moves followed Hometown International's downgrade from a more prestigious OTCQB over-the-counter marketplace for what the OTC Markets Group referred to as "irregularities" in their public notices, and OTC Markets, who told CNBC that they were also E -Waste would keep an eye on.
A trio of Hong Kong investment firms led by Maso Capital, which was one of the largest investors in Hometown International's largest investors last year, are said to be involved in positioning E-Waste as a reverse merger candidate.
Hong Kong investors include companies that are investment arms from Duke and Vanderbilt Universities.
E-Waste's largest single investor, Global Equity Limited, based in Macau, is also the largest investor in the deli owner and Med Spa Vacations, another Shell company affiliated with Coker Sr.
The office building on Avenida Da Praia Grande in Macau, China, is the address for several companies listed as investors in Hometown International, the owner of a single deli in New Jersey.
Catarina Domingues | CNBC
Rollo remains President of Med Spa Vacations, a non-operating Shell company whose office address is that of a company operated by Coker Sr.
According to records, Hometown International Med Spa Vacations loaned $ 150,000 in February.
That loan came after E-Waste loaned an identical amount from Hometown International in November, according to an SEC filing.
Records show that Coker Sr. loaned E-Waste $ 255,000 last September, the majority of which was used to pay the previous owners of E-Waste before they sold their stake in Global Equity Lmiited.
CNBC's articles detailed how Coker Sr., a former college basketball star who refused to comment when contacted by a reporter, allegedly hiding assets from a creditor whom he has nearly 900,000 USD owed and was sued for business fraud. In these cases, he denied wrongdoing.
He was also arrested for soliciting a prostitute, exposing himself and trying to propose three underage girls, according to a newspaper article from Raleigh, North Carolina.
Peter Lee Coker mug shot from the Raleigh / Wake City-County (CCBI) identification office.
Source: Raleigh / Wake City-County Identification Bureau
A firm controlled by Coker Sr., Tryon Capital, until recently had raised $ 15,000 a month from Hometown International under a consultancy agreement. E-waste paid Tryon Capital $ 2,500 per month for its own advisory agreement.
Those agreements were terminated last month after CNBC articles described these deals and Coker's tangled legal history.
SEC filings show Med Spa Vacations is paying Tryon Capital $ 2,500 per month for its own consultancy agreement.
Coker Sr.'s partner in Tryon Capital, Peter Reichard, was convicted in a North Carolina court in 2011 for his role in a program that enabled thousands of dollars to illegally contribute to Democrat Bev Perdue's successful 2008 gubernatorial campaign.
The program involved the use of fake advisory contracts with Tryon Capital. Coker Sr. was not charged in this case.
Peter Reichard, a top Perdue aide, takes the oath before appearing in Wake County Court on Wednesday December 14, 2011 in Raleigh, NC.
John Rottet | The News & Observer | AP
Reichard is also an executive member of a company called Europa Capital Investments, along with Coker Sr., which owns 90,400 common shares of Hometown International and warrants an additional 1.9 million shares.
Reichard is the son of Ram Dass, the late spiritual and LSD guru who gained notoriety in the 1960s and 1970s.
CNBC detailed earlier this week how Coker Sr. and Reichard founded eight Shell companies in 2010 that were later sold to other owners.
Most of these Shell companies were revoked by the SEC after the sale because they were out of date in their disclosures, records show.
One of the companies eventually belonged to a New York real estate tax attorney named Allan Schwartz, who worked for former President Donald Trump decades ago on Trump's real estate holdings. Schwartz told CNBC he didn't know about Reichard and Coker Sr. or the deli owner.
Hometown Deli, Paulsboro, N.J.
Mike Calia | CNBC
Records show that a securities attorney named Gregg Jaclin was involved in starting these Shell companies. Jaclin also helped found Hometown International three years later.
Jaclin was expelled from attorney last year after pleading guilty to indicting individuals "who used those Shell companies as publicly traded vehicles for market manipulation programs" in connection with setting up Shell companies, according to court records.
None of the shells in this scheme were from Coker Sr. and Reichard or Hometown International.